Which of the Following Is a Drawback of Centralization

question 62

Multiple Choice

Which of the following is a drawback of centralization?

• A)It fails to delegate responsibility for carrying out daily and routine procedure to lower level employees.
• B)It is ineffective when the decisions to be made are risky.
• C)It results in a flat organizational structure.
• D)It requires lower-level managers to have strong decision-making skills.
• E)It may take long for an organization as a whole to implement decisions and respond to changes on a regional scale.

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Definitions:

Supernormal Growth Stock

Stocks of companies expected to experience higher than average growth rates in earnings or revenues in the future.

Preferred Stock

A type of stock that provides dividends before dividends are issued to common stockholders and typically does not come with voting rights.

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Individuals or entities that own common shares in a corporation, granting them voting rights and a share in the company's profits through dividends.